To understand where organizational competencies fit in, imagine your organization as a giant tree.
If the core product is the trunk, the business units are the branches. The leaves are all of the product/service offerings.
Finally, organizational competencies are the root network that nurtures the organization’s growth.
In this article, we will:
- Define organizational competencies, and understand their importance.
- Explore the types of organizational competencies.
- Provide examples of each type.
- Know how to identify them.
What are organizational competencies?
From a performance perspective, competencies are a measurable list of skills, characteristics, and knowledge that helps employees successfully perform their jobs. So, organizational competencies are the total of the skills, attributes, and learning an organization needs to perform its tasks.
Why do we need them?
- They help you identify and play to your natural strengths – the things you can do better than your competitors.
- Knowing your competencies can help you create new products or services, access new markets, and launch new business lines that align with your vision.
- Identifying your core competencies can give your organization an idea of which functions to outsource and which ones to keep in-house.
- You can hire the right people based on your core competencies, with competency-based tests and interviews.
- You can give employees a roadmap for personal and professional development based on their competencies.
- Use them to set the standards of performance within any role or team.
- Raise the quality of the feedback between managers and employees.
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Types of organizational competencies & examples
1. Core competencies
They provide value to the customers, are rare to find, and are hard for competitors to imitate perfectly.
Examples of core competencies:
Let’s take the example of Amazon. Amazon’s core competencies include:
- Cost leadership: Offering items that fit the customer’s budget – often at a better quality than what’s available offline.
- Customer differentiation: Offering more choices from a broader range of sellers than the competition.
- Customer convenience and accessibility: Transparency about item availability and delivery times, same-day delivery for Prime members.
How do you identify core competencies?
Indeed.com suggests a 6-step plan to help you find the core competencies of your organization:
- Use your company’s mission statement to pinpoint your core competencies.
- Find out why customers decide to buy from your company. CSAT surveys are a helpful tool for this. Moreover, they can help you compare your customer satisfaction metrics over time.
- Survey your employees to find out what your company does well.
- Compare the answers from points 1, 2, and 3 against the abovementioned criteria. If a competency meets these criteria, you can include them in your core competencies.
- Set your core competencies down in writing.
- Use them to guide your roadmap, resource allocation, and outsourcing.
However, there’s one aspect of core competencies that is frequently overlooked.
Business strategist Daniel W. Rasmus has talked about “emotional infrastructure.” This infrastructure refers to the bonds and work relationships that develop between employees of the company. That bond gets fractured when that work is outsourced to external partners.
“If firms want to do more than execute themselves into a corner, if they want to create innovative products, processes and services, then they need to invest in fostering relationships that shore up their faltering emotional infrastructure.”
- Daniel W. Rasmus, “How Clinging to Core Competencies is Breaking your Organization’s Heart”
So, let’s add one more step to the points above:
7. Build an active and engaged relationship with your partners and outsourcers.
2. Team competencies
The term ‘teamwork’ gets used a lot, but what is it based on? Team competencies are the answer. Every team might require a particular set of competencies depending on the project or function.
Examples of team competencies:
Wikipedia is our go-to when we need a detailed answer on any topic. So, what team competencies can we find in this humongous example of teamwork?
- Collaboration: Fact sharing, and fact-checking, by volunteer writers and editors.
- Neutrality: Ensuring that the content is factual, unbiased, and neutral.
- Knowledge integration: Providing encyclopedic value by putting the data in its proper context, with explanations supported by verifiable sources.
How do you identify team competencies?
A team competency assessment reveals team strengths and more crucially, its weaknesses. Based on the results, you can act to hire more team members or help your current team upskill.
3. Role/Individual competencies
Individual competencies identify the characteristics to be effective in a particular job role.
According to Jennie Yang, VP of People & Culture at 15five, they “can help you connect the right person with the right role, give employees and teams a roadmap for personal and professional development, and improve the quality of coaching conversations between managers and employees.”
Examples of role/individual competencies:
Did you know that there are as many as sixty-two competencies at work? You can group most of them into sets like:
- Job-specific skills: The technical skills required for better performance.
- People skills: Written and verbal communication, situational awareness, etc.
- Leadership skills: Business acumen, strategic thinking, comfort with ambiguity, etc.
How do you identify individual competencies?
Through regular 360-degree reviews and competency analysis, you can identify and build a list of individual competencies over time.
Regularity is key because roles can emerge, expand, or become more specialized. With each change, new skill requirements will appear.
Other organizational competencies
1. Management competencies are the skill sets, knowledge, and attitude necessary to manage people effectively. Some examples include:
- Clarity on projects and priorities
- Ability to delegate and supervise
- Respect towards others
- A growth-centric mind
2. Leadership competencies represent effective leadership within a company. Some examples include:
- Leading innovation
- Ability to lead hybrid/remote teams
- Developing and mentoring people
3. Cross-functional competencies are required for jobs across many functions and teams. Also, you need them for partnerships with external team members and stakeholders. Some examples include:
- Mutual understanding
- Conflict resolution
This article covers the definition of organizational competencies and the types of competencies under that umbrella. We’ve also included organizational competencies examples to help you understand each type better.
At SurveySparrow, we help you measure those competencies with 360 assessments and employee surveys. Then, based on these assessments, HR teams can create personalized development plans in which an employee has room to grow within their role.
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